I have a friend who was paying off a student loan but did not realize there were 2 different student loans and one bill was sent to the parent's address. The late payments caused a drop in credit score to 510 before this was realized. The loan company agreed to remove this "credit ding" after 9 consecutive on time payments. Is this true, can they do this? And how long will it take to rebuild credit? Is it something that may have an instant jump after the "ding" is removed? Please help if you can answer.

Mon Apr 08, 2013 1:34 pm

coasterSenior Advisor

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A good credit score is earned by a good credit history. "Earn" means "perform" and "history" means "time". Where the late payment is the debtor's error, nine consecutive demonstrations of faithful performance is not a hardship at all.

~Tim~

Mon Apr 08, 2013 3:32 pm

oldguySenior Member

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That 510 is about as low as you can go. About 98% of the population is above 500. The 300 to 500 group had a bk, a foreclosure, plus a record of late/no payments.

quote: (only 2% of the population has a score between 300 and 499). Needless to say, hitting the rock-bottom lowest FICO score of 300 is literally unheard of.

Sounds like there is more going on than a few missed SL payments - your friend may have a bunch of 'teenage transgressions' - such as a handfull of derog store credit cards, a few busted cell phone contracts that he blew off, a car repo, yada. You'd have to have many screw-ups to get down to 500. A kid with zero credit history starts higher than that and gets above 650 in just a year or so - but that is based on 'no history' and builds on 'all goods'. But starting from a list of 'bads' the lenders won't want to lend money to this person for a long long time (regardless of the scoring system).

Mon Apr 08, 2013 3:39 pm

RussellAhmedFirst Time Poster

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Your credit score is a numerical value that describes how well you've handled credit. Your credit score will go down if you miss payments, default on loans or go through bankruptcy, but the good news is you can start to repair your credit score immediately with the right behavior. For example, your
credit score may begin to improve soon after your bankruptcy is discharged if you always pay your mortgage on time. Ultimately, this will help repair your credit report too.